FTC settles lawsuit over domain name renewal scam.
The U.S. Federal Trade Commission has settled with a group in Canada that it says posed as domain name registrars and duped thousands of people and companies into paying bogus bills by leading them to believe they would lose their Web site addresses unless they paid. We in the domain name industry often refer to this as the “domain name renewal scam”.
The FTC charged Toronto-based Internet Listing Service back in 2008 with sending fake invoices that appeared to be coming from a domain owner’s registrar. Consumers were led to believe that they needed to pay the invoices in order to continue using their domain names. The invoices also included a search engine optimization service that the FTC says was misleading.
A federal district judge halted the practice after the charges were filed and froze the defendant’s assets. The settlement and default judgment order will end the litigation. The judgment claims $4,261,876 in consumer damages, but the defendants will only pay $10,000 because they say they are unable to pay the full amount.